A fast-growing middle class in China could underpin future expansion in the country’s luxury car market, Daimler said yesterday as strong Chinese demand for its sport-utility vehicles helped push up its quarterly profit.
New launches have spurred Daimler’s luxury-car sales globally to record levels this year, eclipsing Volkswagen’s Audi but still behind BMW.
Its luxury-car division Mercedes-Benz launched the redesigned A-Class compact car and the GLC and GLE sport-utility vehicles (SUVs) in September, and its sales in China — the world’s biggest car market — jumped 53% in that month. Audi’s sales in the country rose 2.9%.
The upbeat Chinese prospects contrast with weak sales figures in the country from other carmakers, including General Motors and BMW, which raised concerns that a big source of profitable growth over the past decade may be running dry as the market matures and economic growth slows.
Daimler said compact SUVs were among the popular cars in China and that it was also benefiting from being better able to service the demand by producing the new GLA compact SUV in the country since April.
The strong sales in China, as well as in Europe, helped Daimler’s third-quarter earnings before interest and tax (EBIT) rise by almost a third to €3.66bn ($4.15bn), it said yesterday, near the €3.76bn top-end forecast in a Reuters poll.
Mercedes-Benz beat Audi by 28,474 cars in worldwide sales over the first nine months of the year in what could upset the pecking order among Germany’s premium brands. Mercedes had been trailing Audi since 2011.
In China, Mercedes has narrowed the sales gap with Audi and BMW this year and expects strong demand to continue in the fourth quarter and in 2016.
Daimler stuck to its 2015 guidance for a significant gain in global deliveries, revenue and operating profit.
But the Stuttgart-based group scaled back expectations for volume growth in global auto markets, saying demand will likely be flat this year because of previous weakening in China, after having guided for growth of about 2% before.